12 January 2017

Skinning The News About Apple's Global Command Center Here in Mesa > FTZ 221

No news or press releases from the City of Mesa News Room www.mesanow.org about what was "the biggest deal" last year here in Arizona - Apple's Global Command Center - but other sources have released details about an application filed in The Federal Register by the city's Office of Economic Development for renewal of a Free Trade Zone in the southeast quadrant.
Posts were made here on this blogsite, and social media sites Facebook and Twitter when "the news" got out" by press releases followed by flurries of reports in business and industry publications.
Recent reports are these from yesterday . . .followed by the first news release 01/08/2016
Forbes

Apple Seeks Approval For Domestic High-Tech Manufacturing
Jan 11, 2017 @ 12:27 PM 263 views
Post written by Julie Littman
Apple is awaiting approval to manufacture high-tech equipment for data centers in Mesa, AZ. The tech company also applied for special status to designate the area as a foreign trade zone, allowing the products to be exempt from duty payments, reports Business Insider.
Manufacturing will be limited to equipment for internal operations related to its data centers, such as routers, network switches, server housing and enclosures. Apple will build and configure servers in Mesa before sending them to other U.S. data centers.
The tech giant already owns a massive global command center in Mesa that stores and serves iCloud backups and iTunes. While Apple typically uses third-party vendors for cloud operations, it has been moving toward running its own servers in-house.
Apple plans to start with about 150 jobs at the Mesa command center, including an on-site executive. [BI]
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TopTech News  
Apple To Manufacture Data Server Cabinets in Mesa, Arizona Facility
Posted January 10, 2017
By Jef Cozza. Updated January 10, 2017 9:47AM
Tech giant Apple took a big step toward expanding its production facility in Mesa, Arizona last month when it requested permission from the U.S. Foreign-Trade Zone (FTZ) Board to expand the types of devices it can build and components it can import to the facility, according to a report on the Federal Registry. The company is looking to repurpose the site to build data server cabinets for use in enterprise Relevant Products/Services data centers, according to the Mesa city government. Since Apple does not currently sell such cabinets, the company may plan to use the machines in its own data centers or may be looking to expand its offerings. Expanded Authority The Mesa production facility that Apple is looking to expand originally belonged to GT Advanced, a defunct manufacturer that used to supply Sapphire glass for Apple devices. When the company declared bankruptcy, Apple took ownership of the plant. If the FTZ Board approves Apple's request for permission to import components and build new devices at the site, the company's production costs could fall significantly. Production under FTZ procedures could exempt Apple from customs duty payments on the foreign materials/components used in export production. "On its domestic sales, Apple would be able to choose the duty rate during customs entry procedures that applies to finished server assembly cabinets (duty-free) for the foreign-status materials/components noted below and in the existing scope of authority," the filing stated. "Customs duties also could possibly be deferred or reduced on foreign-status production equipment." Like many modern manufacturers, Apple's products include a wide variety of components, many of which are sourced from countries around the world. Everything from fiber optic cables to lithium batteries to LEDs are sourced from manufacturers located overseas. The company's iPhone models and other devices are assembled in countries like China, where labor costs are significantly cheaper. Political Pressure If Apple goes through with the plan, the move would be a rare case of a U.S. tech company moving production and manufacturing operations stateside, although Apple does already build some servers in Oregon and elsewhere in Arizona. The expanded FTZ authorization would effectively consolidate that production into the Mesa facility, which the company said will provide the local job market with some 150 high-paid positions. Several manufacturers have come under scrutiny recently for decisions to expand their operations in other countries while closing factories in the U.S. In particular, President-elect Donald Trump has called out companies such as Toyota, Carrier, and Ford over Twitter after they announced plans to open plants in Mexico. Trump specifically mentioned Apple and its products by name during the presidential campaign, saying that if he were elected, the company would be encouraged to assemble the iPhone in the U.S. Trump reportedly called Apple CEO Tim Cook after the election to discuss the company moving more of its manufacturing operations to the States.

Nope, Apple won’t manufacture servers at AZ center
By
Apple says it has no plans to manufacture high-tech servers in the USA, despite a recent report claiming the iPhone-maker applied for permission to do “high-tech manufacturing” at its site in Mesa, Arizona.
The Mesa center was previously the home of Apple’s ex-sapphire supplier that went bankrupt in 2014. Instead of seeking permission to manufacture on the site, Apple clarified that it is actually just applying to renew the original Foreign Trade-Zone status of the location that brings some big tax benefits.
The original report on Apple’s application claimed the company would manufacture data farm servers to be used internally. Apple reached out to TechCrunch and explained that no products will be manufactured at the site.
“Its intention is for Mesa to become a global command hub for its data center operations,” reports TechCrunch. “Meaning the site will be used as the central location where it receives and configures servers, assembling them into racks, before distributing the units for use in its various data centers.”
The global command hub still isn’t operational. Apple says the only production at the site will be to configure the servers and then shipping them out to Apple’s other sites around the world.
Even though Apple won’t be bringing server manufacturing jobs to AZ, the company claims that 33 different US states contribute to the making of Apple products. It’s previous annual suppliers report includes 69 manufacturing facilities in the US that make components for iOS devices and the Mac.

FIRST RELEASE from Targeted News Service on Sunday, January 8, 2016
Foreign-Trade Zones Board Issues Notice on Proposed Production Activity for Apple in Mesa, Ariz.
2017-01-08
Targeted News Service

WASHINGTON, Jan. 8 -- The Foreign-Trade Zones Board published the following notice in the Federal Register for proposed production activity for Apple Inc. within FTZ 221 in Mesa, Ariz.....[document citation


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